4B — June 28 - July 11, 2013 — Owners, Developers & Managers — Mid Atlantic Real Estate Journal
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C ONTRACTORS /S UBCONTRACTORS By Andrew B. Cohn, Kaplin Stewart Pennsylvania court expands lien rights for excavation work
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ntil very recently, con- tractors performing excavation and site
rule abruptly changed on May 17, 2013 in a decision by the Pennsylvania Superior Court in B.N. Excavating, Inc. v PBC Hollow-A, L.P., et. al . Based on this decision, contractors now have the right to file mechanic’s liens in Pennsylvania based on excavation and site prepara- tion work performed even if a building or other structure is not ultimately constructed at the site. This is a significant change in the judicial inter- pretation of the Pennsylvania Mechanic’s Lien Law.
In B.N. Excavating , a site work subcontractor performed excavation, topsoil stripping, concrete pipe, and other sub- grading work for a building pad. However, no building or other structure was ever constructed at the site. When no payment was made for this work, the subcontractor nev- ertheless filed a mechanic’s lien. The lien was dismissed by the trial court which held that because no building was ever constructed, the lien was invalid. The trial court followed
existing case precedent which had established that the Penn- sylvania Mechanic’s Lien Law would not allow a lien for work unconnected to the construc- tion of an actual building. However, in the B.N. Ex- cavating opinion, the Supe- rior Court reached a different result. It determined that because the excavation and other site preparation work was performed in connection with planned construction of two buildings, the lien was, on its face, proper.
The court’s opinion focused on language in the lien law which provides that property is lienable for excavation which is performed incidental to the erection or construction of an improvement. In essence, the court ruled that excava- tion and site preparation work is lienable in Pennsylvania if that work contemplates or is connected to the planned construction or erection of a building. In this case, the Claimant’s lien specifically al- leged that this was the intent of the subcontractor and general contractor. What is the import of the B.N. Excavating decision? It clearly expands the range of activities for which a lien may be filed in Pennsylvania. The test or standard by which ac- tivities performed in advance of the actual construction of the building will be evaluated appears now to be that if the activity was intended by the contractor performing it to be incidental to or preparatory to the construction of an actual building, a lien will be allowed even if no building is actually constructed.Now, under B.N. Excavating , the actual con- struction of a building is not necessary to support a lien for pre-construction excavation and site work. Pennsylvania developers seeking to avoid liens for such activity should secure lien waivers, where per- mitted under the lien statute. Andrew B. Cohn, Esquire is a principal in the con- struction law group of Kap- lin Stewart ■ Karndean Design- f l oor i ng names Mellow as VP of marketing EXPORT, PA — Karndean Designflooring has named Emil Mellow as VP of mar- keting for the U.S. Mellow will work with the marketing team to develop strategic, multi- faceted marketing campaigns with a strong focus on brand- ing, merchandising and sales support. “Emil has an exceptional record of achievement in de- veloping and executing strate- gic marketing initiatives that complement sales objectives,” said Ed Perrin , CEO of Karn- dean Designflooring. ■
preparation w o r k d i d not have the right to file a mechan- ic’s lien in Pennsylva- nia unless a building or other im- provement
Andrew B. Cohn
was actually constructed at the site. That hard and fast
Contact: Andrew B. Cohn, Esq. 910 Harvest Drive, Blue Bell, PA 19422-0765 • 610-260-6000 • www.kaplaw.com Other Offices: • Cherry Hill, NJ 856-675-1550 • Philadelphia, PA 215-567-3120 Kaplin Stewart At t o rne y s a t Law Getting you through the maze of real estate law. Strategy. Skill. Success.
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